MIRA INFORM REPORT

Report Date :

31.10.2012

IDENTIFICATION DETAILS

Name :	AL-ABBAS SUGAR MILLS LIMITED

Registered Office :	2^ndFloor, Pardesi House, Survey No. 2/1, R.Y. 16, Old Queens Road, Karachi

Country :	Pakistan

Financials (as on) :	30.09.2011

Year of Establishment :	1991

Com. Reg. No.:	0023923

Legal Form :	Public Limited Company

Line of Business :	· Manufacturing & sale of Sugar Processing & sale of industrial ethanol Manufacturing & sales of Calcium Carbide, Ferro Alloys, Generation and sale of Electricity

No. of Employees :	575 employees

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory
Payment Behaviour :	No Complaints
Litigation :	Clear

NOTES:

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – June 30^th, 2012

Country Name

Previous Rating

(31.03.2012)

Current Rating

(30.06.2012)

Pakistan

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

pakistan - ECONOMIC OVERVIEW

Decades of internal political disputes and low levels of foreign investment have led to slow growth and underdevelopment in Pakistan. Agriculture accounts for more than one-fifth of output and two-fifths of employment. Textiles account for most of Pakistan's export earnings, and Pakistan's failure to expand a viable export base for other manufactures has left the country vulnerable to shifts in world demand. Official unemployment is 6%, but this fails to capture the true picture, because much of the economy is informal and underemployment remains high. Over the past few years, low growth and high inflation, led by a spurt in food prices, have increased the amount of poverty - the UN Human Development Report estimated poverty in 2011 at almost 50% of the population. Inflation has worsened the situation, climbing from 7.7% in 2007 to more than 13% for 2011, before declining to 9.3% at year-end. As a result of political and economic instability, the Pakistani rupee has depreciated more than 40% since 2007. The government agreed to an International Monetary Fund Standby Arrangement in November 2008 in response to a balance of payments crisis. Although the economy has stabilized since the crisis, it has failed to recover. Foreign investment has not returned, due to investor concerns related to governance, energy, security, and a slow-down in the global economy. Remittances from overseas workers, averaging about $1 billion a month since March 2011, remain a bright spot for Pakistan. However, after a small current account surplus in fiscal year 2011 (July 2010/June 2011), Pakistan's current account turned to deficit in the second half of 2011, spurred by higher prices for imported oil and lower prices for exported cotton. Pakistan remains stuck in a low-income, low-growth trap, with growth averaging 2.9% per year from 2008 to 2011. Pakistan must address long standing issues related to government revenues and energy production in order to spur the amount of economic growth that will be necessary to employ its growing population. Other long term challenges include expanding investment in education and healthcare, and reducing dependence on foreign donors.

Source : CIA

Business Name

AL-ABBAS SUGAR MILLS LIMITED

Important Note:

The address PNSC Bldg, 4th Floor$Moulvi Tamizuddin Khan Road Karachi 74000, Pakistan provide by you was previous address of the company.

Full Address

Registered Address

2^ndFloor, Pardesi House, Survey No. 2/1, R.Y. 16, Old Queens Road, Karachi, Pakistan

Tel #	92 (21) 111-111-224
Fax #	92 (21) 32470090
Website	www.aasml.com

Factory Location

· Mirwah Gorchani District, Mirpurkhas, Sindh, Pakistan.

Main National Highway, Dhabeji, Sindh, Pakistan.

Short Description Of Business

Nature of Business

(1) Manufacturing & sale of Sugar.

(2) Processing & sale of industrial ethanol.

(3) Manufacturing & sales of Calcium Carbide, Ferro Alloys, Generation and sale of Electricity.

Year Established

1991

Registration No.

0023923

Auditors

Hyder Bhimji & Co.

(Chartered Accountants)

Legal Status

Al-Abbas Sugar Mills Limited was incorporated in Pakistan as a Public Limited Company. The Company is currently listed on Karachi & Lahore Stock Exchanges.

Details of Chief Executive / Directors

Names

Designation

Mr. Muhammad Iqbal Usman

Mr. Shunaid Qureshi

Mr. Asim Ghani

Mr. Duraid Qureshi

Mr. Mudassir Iqbal

Mr. Munaf Ibrahim

Mr. Munawar A. Siddiqui

Chairman

Chief Executive

Director

Categories of Shareholders

Categories

Percentage

Directors, CEO, and their spouses and minor children

Associated Companies, undertaking and related parties

NIT & ICP

Banks Development Financial Institutions, Non Banking Financial Institutions

Insurance Companies

Modarabas and Mutual Fund

General Public

Others

14.0555

62.8716

0.2146

16.4759

nil

0.0035

5.4250

nil

Associated Companies

(1) Al-Abbas Industries Limited, Pakistan.

(2) Al-Abbas Cement Industries Limited, Pakistan.

(3) Javedan Cement Limited, Pakistan.

(4) Al-Abbas Holdings (Pvt) Limited, Pakistan.

(5) Ghani Holdings (Pvt) Limited, Pakistan.

Products

· Manufacturing & sale of Sugar.

Processing & sale of industrial ethanol.

Manufacturing & sales of Calcium Carbide, Ferro Alloys, Generation and sale of Electricity.

Number of Employees

575

Capacity And Production

2011 2010

Sugar Unit

Sugarcane crushing capacity per day 7,500 7,500

No. of days season operated 140 120

Sugarcane yield 10.17% 10.39%

Capacity in litre based on number of days

Operated and sugarcane yield 105,260 95,848

Production in M.Tons 63,395 57,130

Distillery Unit

Unit - 1

Capacity in Litres per day 85,000 85,000

Days 270 293

Capacity in litres based on no. of days operated 22,950,000 24,905,000

Production in litres 22,707,194 24,689,438

Unit - II

Capacity in Litres per day 87,500 87,500

Days 297 278

Capacity in litres based on no. of days operated 25,987,500 24,325,000

Production in litres 25,793,176 23,963,857

Calcium Carbide & Ferro Alloys

Capacity in M.Tons 27,220 27,220

Production in M.Tons 1,243 2,192

Power

Capacity in Kilo Watts Hour (KWH) per day 312,000 312,000

No. of days operated 68 178

Capacity in KWH based on number of days

operated 22,216,000 55,536,000

Production in KWH 19,878,605 53,142,480

Customers

Various Locals

Bankers

(1) Al-Baraka Islamic Bank, Pakistan.

(2) Allied Bank Limited, Pakistan.

(3) Bank Al-Falah Limited, Pakistan.

(4) Habib Bank Limited, Pakistan.

(5) KASB Bank Limited, Pakistan.

(6) MCB Bank Limited, Pakistan.

(7) Silk Bank Limited, Pakistan.

(8) Standard Chartered Bank, Pakistan.

(9) United Bank Limited, Pakistan.

Financial Position

Sound

Future Outlook

the future outlook of the Company entirely depends on stable selling prices ob both sugar & ethanol. The sugar price of local and international market is showing continuous decline as compared to previous quarters. The price for sugarcane is fixed at Rs. 154 per maund for season 2011 – 2012 which is quite high if we compared with current prevailing prices of sugar. Due to recent deluge, the recovery of sugarcane is expected to be lower as compared to last year. There is a bumper crop in whole Punjab and some of the region of Sindh which were not affected by recent flood.

Memberships

· All Pakistan Sugar Mills Association.(APSMA)

Foreign Exchange Rates

Currency	Unit	Pakistani Rupee
US Dollar	1	Rs. 95.50
UK Pound	1	Rs. 152.00
Euro	1	Rs. 122.30

Comments

Subject Company enjoys good reputation in Pakistan. Directors are reported as qualified, resourceful & experienced businessmen. Company can be considered for normal business dealings at usual trade terms and conditions.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.54.17
UK Pound	1	Rs.86.83
Euro	1	Rs.69.85

INFORMATION DETAILS

Report Prepared by :

MNL

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
----	NB	New Business	----

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

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